D.C. Schools Wait Nine Months for Rebate Accounting from Chartwells

By Ed Bruske
aka The Slow Cook

D.C. Schools Chief Operating Officer Anthony Tata told The Washington Post yesterday that he has been waiting some nine months for Chartwells, the school system's hired food sesrvice provider, to furnish an itemized accounting of the rebates it receives from food manufacturers in connection with its purchases for school meals.

Tata made the disclosure to Post education reporter Bill Turque after I reported here yesterday that Chartwells since beginning its contract with D.C. schools in the fall of 2008 had collected more than $1 million in rebates from major food suppliers who are seen as discounting popular brands in order to place them before impressionable children on cafeteria trays. Under federal laws governing the national school meals program, food providers such as Chartwells are required to credit the schools for any rebates they receive and furnish a detailed accounting of where the rebates come from upon request from the school district.

Tata told Turque I was "just flat wrong" when I reported yesterday that school officials had not asked Chartwells for such an accounting until after I filed a Freedom of Information Act request last month seeking the information. In fact, Tata said, he had been pressing Chartwells for the information since last October, and it had only just arrived.

Under its contract with D.C. schools, Chartwells receives a $1 million administrative fee annually, plus fees on each meal served that total more than $1 million each year. Chartwells provides food service in 122 D.C. schools. In a number of ways, Tata and other school officials have indicated they are not entirely happy with the industrially-process convenience foods Chartwells has been serving. DCPS recently sought bids on two pilot programs that would each ostensibly provide improved food to seven schools across the city "to create some competition," in Tata's words.

I filed my FOIA request for the rebate itemization June 1. On June 4, I asked schools spokeswoman Jennifer Calloway in an e-mail, "Has DCPS ever requested from Chartwells a breakdown of where the 'rebates' are coming from according to specific manufacturers or suppliers, or even by category of product?" Calloway replied, "Tata's team is reviewing your request, we'll get back to you Monday." But they did not get back to me.

More than a month later, on July 8, I again asked Calloway, "whether DCPS has ever asked Chartwells for a breakdown on where--meaning which manufacturers or vendors--all of the rebates come from that are reflected on Chartwell's monthly invoices." Later that day, Calloway responded: "We have requested a breakdown. You need to file a FOIA for DCPS to share it--and you've already done so. When it's complete, the General Counsel's office will contact you."

I regret if I misinterpreted what the schools spokeswoman said. Apparently, the information Tata had been trying to get hold of from Chartwells since last October arrived sometime between my last e-mail exchange with Jennifer Calloway on Thursday and Tata's conversation with The Post on Monday. It was also on Thursday that I interviewed a procurement official with Foodbuy, a sister company of Chartwells that is responsible for negotiating food purchases and rebates with manufacturers.

Tata further told Bill Turque that I was "irresponsible" for referring to the food rebates as "kickbacks." But I did not coin that term in reference to food rebates. It may be that Mr. Tata is simply unaware that "kickbacks" is a common usage in food service circles to describe the system whereby powerful companies such as Chartwells, Sodexo and Aramark expect and receive generous rebates on a host of products, much the same way that grocers expect and receive payments from manufacturers in order to give their products prominent display on supermarket shelves.

In fact, Ann Cooper, one of the most prominent school food directors in the country, now in charge of food for schools in Boulder, CO, used the word "kickbacks" in a Twitter item about my story that she broadcast yesterday.

The $1 million-plus in rebates Chartwells had collected through February of this year represented five percent of the total purchases reported on invoices the company submitted to D.C. Public Schools for reimbursement. In other jurisdictions, that percentage is much higher. It will be interesting to see the details of where Chartwells says the rebates came from, and how quickly the schools make that information public.

Meanwhile, Tata told Turque that schools food services director Jeffrey Mills is reviewing menu changes in the food Chartwells serves for the upcoming school year with an eye toward improvements. "And the rebate, if there is one, will not factor at all into our decision making," Tata said.